Getting insured? Read the fine print carefully

If you thought that you have ensured your peace of mind just by getting yourself and your family members insured, better do a reality check. Chances are that your claims may be partially honoured or may even be rebutted, if you have just missed out something while signing on the dotted lines. No wonder, getting yourself acquainted with the terms and conditions of an insurance cover is as much essential as getting the cover itself.

Exclusions in critical care insurance

By getting critical care insurance, for instance, you might be thinking of an assured financial support at critical times, particularly when you are diagnosed with any of the critical illnesses and procedures covered, like cancer, bypass surgery, heart attack and kidney failure, among others. As critical care policies are also priced higher than the normal mediclaim policies and provide exclusive cover for the illnesses covered, this may instill extra confidence in you that nothing is likely to go wrong - at least financially - even if something worse happens.

But read the fine print carefully which says that "any illnesses and procedures within 90 days from start date of policy will not be covered." It means that even if you are diagnosed with the illnesses and procedures covered within 90 days from start date of the policy, you are not entitled for a claim. Likewise, in case of heart valve replacement, surgeries using 'Balloon or catheter techniques' are excluded from the policy coverage. Even paralysis resulting directly or indirectly or as a consequence of any 'self-inflicted injury' is excluded. And the list of such exclusions goes on and on!

Precautions in householder's insurance

Householder's insurance is the best way to protect your house as well as your belongings from any mishappening. But the cover is useless if you have failed to take adequate precaution while opting for this cover, and even after taking it.

For instance, if you have insured your house at the market value or at the price you bought it, you are not likely to be compensated adequately as the insurance company will pay only the replacement price of your property. So it is better to insure your property on a reinstatement basis only.

Similarly, jewellery/precious stones are covered under a separate section against all risk coverage. For instance, if you are getting your jewellery insured, the detailed description of the jewelry should be clearly mentioned in the policy. If this step is taken, the original receipts of the jewellery, if they have been lost, will not be required. Similarly, if there is any cash or jewellery to be insured beyond value of Rs 10,000, the same needs to be specifically declared and incorporated in the policy.

It would also help to know that claims for loss of or damage to money, securities, stamps, bullion, deeds, bonds, share certificates, manuscripts or documents of any kind will be repudiated.

Burglary insurance

These days burglary has become an unpleasant reality of urban living, even in residential complexes which provide security. With higher incomes and greater travel, both for work and pleasure, homes are often unoccupied for long periods of time. While we all need to take precautions, burglary insurance - which is part of householder's insurance - can indemnify us when our valuables are burgled.

Under this cover, however, there is a policy condition that the home must not be unoccupied for more than one month. So ensure that a servant or family member occupies your home in your extended absence. Also be aware that if an employee or family member is the burglar, the claim will get rejected. Thus, if your servant has decamped with the valuables, you won't get anything from the insurance company.

Also remember that in case of a theft, a first information report (FIR) from the police is mandatory, and that loss of or damage to livestock, motor vehicles and pedal cycles can't be claimed under a burglary policy.

Personal accident cover

Personal accident cover is one of the key security measures to undertake for providing financial security in case of an injurious accident. It ensures that one's family does not suffer in the event of an accident by providing compensation for accidental death or disablement.

However, there are so many exclusions in this cover also. For instance, such policies usually exclude cover for death or disablement due to any natural calamity, any pre-existing conditions/disabilities, any mental disorder, and needless exposure to peril, among others. Thus, if someone dies in a car race or while jumping from a height, such claims will outrightly be denied by insurance companies.

Motor insurance

Motor insurance normally covers you against any loss or damage caused to the vehicle due to natural and man-made calamities. It also provides personal accident cover and protects you against any legal liability arising due to accidental damages.

However, under this insurance you are normally not covered against so many things, including normal wear, tear and general aging of the vehicle, mechanical/ electrical breakdown, depreciation or any consequential loss, wear and tear of consumables like tyres and tubes, and loss/ damage due to war, mutiny or nuclear risk. Also, damage to/ by a person driving any vehicle or car without a valid licence is not covered, nor is damage to/ by a person driving the vehicle under the influence of drugs or liquor.

Obtain a proper policy document

It is clear, thus, that only getting insured is not enough. The insured should also be aware with the policy's terms and conditions. For this, it is essential to obtain a proper policy document evidencing the contract and reading it carefully. Simply because signing on the dotted line in the proposal form binds the proposer as regards facts disclosed therein, and it won't be possible for the insured to banish the declarations later on.